Open access in the ownership regime and its prospects in Vietnam

In terms of semantics, ownership by the entire people is a type of ownership whose the owner is the whole people; the object of ownership under the current Constitution includes:[r]

OPEN ACCESS IN THE OWNERSHIP REGIME AND ITS PROSPECTS IN VIETNAM

Nguyen Quang Duc586 Summary: It is, in fact, proved that the lack of rules in using the high-value

resource results in the abuse This article is to summarize and compare the open access in the ownership regimes with current regimes of common ownership in Vietnam (ownership by the whole people, ownership by the community, mixed multiple ownership) over common resources (which have been basically prescribed as the ownership by the whole people in Vietnam) A gap in Vietnam‘s legal system has been found in which the lack of studies and regulations related to open access in ownership is seen as the bottleneck causing the inequality (or abuse) among stakeholders in accessing the common resources Based on the movement as well as inadequacies of the current ownership of legal system, the author, thus, analyzes the prospects and proposes the application of open access of ownership regime in Vietnam

Keywords: Open access, common ownership, common resources 1 Open access in ownership regime

1.1 Introduction to open access mode in ownership

Ciriacy-Wantrup, Siegfried V and Richard C Bishop587, in a well-known article, significant figure out the difference open access regimes in which no one has the legal right to exclude from using a resource and joint ownership in which the members of a clearly demarcated group have a legal right to exclude nonmembers of that group from using a resource Open access regimes including cases of ocean, atmospheres, local streams, forests, grazing areas, and coastal fishing grounds have been considered in Earth Jurisprudence because there is no limit to who is entitled to use the resource No one is allowed to convert or invest, improve such use right of others The lack of rules related to use a resource creating high value products results in the abuse Some local grazing areas, coastal beaches and forests, for example, are sources of free access and in fact, easily abused

Some open access regimes are seen to lack of the rules for establishing private property rights at default588 or the resources are reported to be affected by these open access regimes which are not limited to a country or no entity identifying the legal ownership Other open access regimes are the result of public policies with concern to ensure the access to use of a resource of all city residents under political authority In the early twentieth century, for example, the Oregon and Washington State Governments (United States) intervened to prevent local salmon fishers from stating restrictions on entry and establishing exploitation limits589 Fishing unions along US coastal areas managed to organize coastal fish farms to limit entry and set restriction of exploitation in the 1950s Despite their efforts did not seriously affect the prices due to the vibrant international fish market, these unions were prosecuted by the US Ministry of Justice for violating Sherman's Antitrust Act590 Therefore,

586

Centre for Legal Research & Services (LERES), School of Law, Vietnam National University Email: nguyenquangduc.vnu@gmail.com

587

Ciriacy-Wantrup, Siegfried V and Richard C Bishop (1975), ‗―Common property‖ as a concept in natural resource policy‘, Natural Resources Journal, 15, 713– 727

588 Dales, John H (1968), Pollution, Property, and Prices: An Essay in Policy-Making and Economics, Toronto: University

of Toronto Press

589

Higgs, Robert (1996), ‗Legally induced technical regress in the Washington salmon fishery‘, in L J Alston, Thráinn Eggertsson, and Douglass North (eds), Empirical Studies in Institutional Change, New York: Cambridge University Press

590 Johnson, Ronald N and Gary D Libecap (1982), ‗Contracting problems and regulation: The case of the fishery‘,

US coastal fishing grounds have become an open source of access for many years in the twentieth century due to government actions to prevent local groups from establishing common regime within political authority However, both national and state governments have recently reversed their position in the past and actively sought to create co-management forms at coastal beaches

The other type of open access is consequence of the ownership of institutions that have been ruled out ineffectively that no one is the owner In many developing countries, the confusion between open-access and common-ownership regimes leads to an increase in the number and scope of local resources that are open to access The common ownership system controlling access and harvesting from local streams, forests, grazing areas and coastal fishing grounds has developed over a long time in all of places in the world but rarely stipulated official in the legal regulations of newly independent countries.591

1.2 Distinguishing the open access and common ownership regimes

When interest in the protection of natural resources increased in the 1960s, many developing countries nationalized all the land and water resources that had not been recorded as personal property Institutional agreements that local users created to limit intrusion and use were seen to lose their legal status; the national governments, however, did not provide with enough human resources and money to track their use of resources The open access regime is figured out in the nature of the use of those resources under the common ownership regime of the local people were transformed into state management regime of state ownership As resources previously controlled by local people have been nationalized, it is actually proved that the state control seems to be less effective than the direct one by directly affected objectives, either a tragedy in other word The harmful effects of forest nationalization previously managed by local user groups have been clearly found out in Thailand, Nigeria, Nepal, and India Similar consequences have occurred to coastal beaches held by state or national agencies instead of fishermen control.592

Issues arising from confusion between open access and common ownership are mostly related to secondary terms The "common property" term is used to describe a type of business goods that can be more accurately called "common resources‖ All common resources include two important attributes for economic activities: (i) costly to exclude individuals from using goods whether through the physical barriers or legal documents and (ii) an individual's benefit shall be deducted from the benefits available to others593 Recognizing the type of goods including these two attributes, scholars are able to identify core theoretical issues for an individual in case whenever other individuals or groups use those resources in a long time

Common resources shall be owned by national, regional or local governments, by community groups, by private individuals or companies, or used as open access sources by anyone who is able to approach.594 Every type of ownership regime owns different advantages and disadvantages but somehow relies on similar operational rules regarding the access and

591

Wiersma, Lindsey L (2005), ‗Indigenous lands as cultural property: A new approach to indigenous land claims‘, Duke Law Journal, 54, 1061–1088

592

Elinor Ostrom and Charlotte Hess, Private and Common Property Rights, Workshop in Political Theory and Policy Analysis, Indiana University, 29/11/2007 Retrieved March 31, 2019, from

https://surface.syr.edu/cgi/viewcontent.cgi?article=1024&context=sul

593

Ostrom, Vincent and Elinor Ostrom (1977), ‗A theory for institutional analysis of common pool problems‘, in Garrett Hardin and John Baden (eds), Managing the Commons, San Francisco, CA: W H Freeman, pp 157–172

594

In Vietnam, coastal private projects prevent the access and use of local communities and tourists which continues to occur in many coastal provinces and cities

See more: https://plo.vn/thoi-su/dai-bieu-lo-dan-het-duoc-tu-do-tam-bien-o-phu-quoc-774398.html (Retrieved April 05, 2019) https://tuoitre.vn/khong-the-chap-nhan-tinh-trang-lay-bien-lam-cua-rieng-2018110711421466.htm (Retrieved April 05, 2019)

use of a resource.595 It is worth proving that the management and assurance of common resources of governments, community groups, cooperatives, voluntary associations, and private individuals or businesses may success or not.596 There is, thus, no automatic combination of common resources with common ownership regimes or, with any other specific regulation for real estate Common ownership agreements are sharing contracts that also face such similar difficulties of opportunistic behavior and moral issues

2 Prospects of open-access regime in Vietnam 2.1 The application premise

2.1.1 The movement and inadequacies of the Vietnamese legal system on common ownership

Ownership rights in Vietnam has been established, adjusted and protected by the legal documents The Constitution stipulates that people have ownership right to legal income, savings, housing, living materials, means of production, capital contributions in enterprises or other economic organizations; freedom of business in business lines that are not prohibited by law Private ownership and inheritance rights are also protected by law Legal assets of individuals, organizations of investment, production and business are regulated by law in which are not nationalized Land, water resources, mineral resources, marine resources, airspace, other natural resources and assets invested and managed by the State are seen as public property belonging to the entire people in whom the state representatively own and manage Organizations and individuals are entitled to allocate land, lease land with the land use right by the State Land users are entitled to transfer land use rights and exercise their rights and obligations in accordance with law Land use rights are protected by law.597

Civil Codes are important documents establishing and enforcing Vietnamese ownership rights, including the concepts and contents of ownership; ownership regimes; basis for arising and termination of ownership; protection of ownership rights and other issues related to ownership rights such as the rights of non-owners to property having certain powers in possessing, using and disposing of property of others, the basis for the court to resolve ownership disputes In general, the ownership rights system is getting more completed and finalized in the establishment and amendment of the legal documents Some shortcomings, however, are found as follows:

Firstly, the form and regime of common ownership is yet complicated and inconsistent

It is noted to be both irrational and complicated in the legal system if the determination of current common ownership regimes (state ownership, collective ownership, private ownership, joint ownership, ownership of political organizations, socio-political organizations, ownership of socio-occupational political organizations, social organizations, and social-occupational organizations) is based on the functions and tasks of the subjects The inconsistency is found in naming ownership rights of some special assets such as land, water resources, mineral resources, other natural resources and assets invested and managed by the state as a public property According to the Civil Codes, these assets are state-owned while they belong to the entire people in whom the state acts as the owner's representative to manage under the Constitution.598

Secondly, the implementation mechanism of ownership right by the entire people on land is yet inconsistent

The Constitution and Land Laws (of 1987, 1993, 1998, 2001, 2003, 2013) have all

595

Feeny, David, Fikret Berkes, Bonnie J McCay, and James M Acheson (1990), ‗The tragedy of the commons: Twenty-two years later‘, Human Ecology, 18, 1–19

596 Bromley, Daniel W (1992), ‗The commons, common property, and environmental policy‘, Environmental and Resource

Economics, 1–17

597

Dinh Tuan Minh, Pham The Anh (co-ed) (2016), From the executive state to the state of development, Tri Thuc Publisher, Hanoi, p 433

598 Dinh Tuan Minh, Pham The Anh (co-ed) (2016), From the executive state to the state of development, Tri Thuc Publisher,

consistently affirmed that land belongs to the entire people, managed by the state It is, however, worth noticing that the implementation of those rights is restricted in fact It is not clearly specified when regulating the state acts as the owner or the owner‘s representative of the ownership right on land The rights of land users, on the other hand, basically seem to belong to the owner Land users are regulated to provide with rights including the right to transfer, lease, inherit, mortgage; but it is not significantly defined these rights for the entire people Implementation institutions of land ownership yet show the gaps in which is especially the rule regarding to land allocated to state-owned enterprises for management and use In principle, land allocated to state-owned enterprises is public assets invested by the state in state-owned enterprises, are required to capitalize, account and include in the pricing structure of enterprises It, in fact, has not been implemented

Regarding property rights associated with land, problems raising in the course of land use rights and ownership of properties on land not only create difficulties to the real estate market operation, but also turn it into one of the most concern issues in social life The land compensation and clearance mechanism is not satisfactory in spite of its ―market‖ rules regulated in the Land Law of 2013 Due to the inadequacy of land ownership relations, it is unclear to identify which formal mechanisms to turn the land into developed capital and land use rights into the commodities Land use planning and management, construction planning remain shortcomings as well as the gaps are found in land and real estate finance, valuation and auction of land and real estate on the land Regulations on land tenure are resulted in a major obstacle to rural farm economy The inspection and supervision of the real estate market's operation lack of capability.599 It takes time and great effort to realize those changes into life and consistent movement of society

Legal system of land in Vietnam is found to enormous in quantity but complicated, overlapped, duplicated and yet market-friendly in terms of content Regarding the promotion of market economy, three main bottlenecks are identified in policies on land and law enforcement on ownership and land use rights in Vietnam: Firstly, regulations on ownership and land ownership are reported to be unclear and specific; enforcement of ownership and protection of land ownership rights, especially for farmers, is weak and ineffective as details: (i) the establishment of ownership of people and businesses is difficult and costly; (ii) the implementation of land assignment rights (or the assignment of allocated or leased land use rights) is found too difficult, costly and even impossible to implement while (iii) the recovery of land use rights of people and businesses, especially farmers from the state is too easy, unpredictable, yet transparent Secondly, Land allocation and land lease are still implemented by administrative measures instead of establishing the primary market for land use rights

Thirdly, the secondary market for land is limited and misled into the speculation To sum up,

the market (or market rules and regulations) mostly has no room to operate and affect land allocation in the Vietnamese economy

2.1.2 The ownership regime by the entire people not yet determined

The ownership by the entire people and the establishment of a mechanism to effectively operate this regime is a continuous issue mentioned by Vietnamese academics and leaders, since this term is constitutional (in the Constitution of 1959) In terms of semantics, ownership by the entire people is a type of ownership whose the owner is the whole people; the object of ownership under the current Constitution includes: land, water resources, mineral resources, marine resources, airspace, other natural resources and assets invested and managed by the state (Article 53 of the Constitution of 2013) In terms of law, all Vietnamese citizens have (common) ownership for all the above-mentioned ownership objects

The concept of ownership relates to many approaches of economics, politics, philosophy

599 Dinh Tuan Minh, Pham The Anh (co-ed) (2016), From the executive state to the state of development, Tri Thuc Publisher,

and jurisprudence.600 In term of legal perspective, it is easy to find out the ownership means the function content of "exclusive to access", exploit and benefit by an asset and accompanying the right to exclude other entities to access, exploit and benefit by that asset Hence, ownership gives owners the advantage in accessing, exploiting and using assets to seek for their benefits Ownership by the entire people, therefore, only makes sense if the mechanism for each individual to benefit or be aware of the benefits from the ownership of the entire people exits The current regulation on the objects of ownership by the entire population (Article 53, Constitution of 2013) has the following remains601:

Firstly, listing the objects of the ownership by the entire people in the constitution

poses challenges in the implementation process Does a person taking water from a river (exercising his ownership) compromise the ownership of the others, for example? Thus, the process of each individual exercising the ownership by the entire people at the same time means the invasion of the ownership by the entire people of others

Secondly, the regulation of assets invested and managed by the state is also the

property of ownership by the entire people may cause difficulties in the process of completing the law on enterprises with state-invested capital in the future In this case, when the state establishes a legal entity and assigns the property to that legal entity, it is supposed that the state is only the owner of the legal entity and is no longer the owner of the assigned property This assigned asset becomes the subject of ownership of the legal entity by this way Thus, the legal status of state-owned enterprises is complete and no parallel status of property owners remains It also proves the constitutional basis to reform the regulations on asset management in state-invested enterprises

The enforcement and protection of ownership regime by the entire people not yet clarified is the toughest bottleneck since its constitutional regulation The pressing issues in land management, state-owned enterprises management and administration, protection of forest, natural resources and minerals, and problems in public spending within the country in the last time are evidence of statement.602 Obviously, public assets are always vulnerable to require special protection mechanisms This mechanism involves three (03) basic subjects: (1) the subject of ownership by the entire people is the entire Vietnamese people; (2) the representative of the owner is the State of Vietnam (its specific authorities); and (3) the subject directly managing, exploiting, using and benefiting by assets of the ownership by the entire people (on the assigned or leased establishment) Authorization relation is supposed to be in the owner and representative Contractual or administrative relations are respectively found between the representative and the subject directly managing, exploiting, using and benefiting

The mechanism of managing, using, exploiting and developing properties of the ownership by the entire people is theoretically designed to best protect the interests of the owners It means to best exploit, use and develop properties of the ownership by the entire people, for the common interest of the community The relationship between three (3) types above, in fact, is not always a consensus People have their own interests and the possibility of conflict of interest always remains What is considered good for this subject is not always

600

See more articles:

Tran Quang Huy (ed) (2016), Textbook of Land Law (Hanoi Law University), Cong an Nhan dan Publisher., Hanoi;

Nguyen Thanh Tuyen (ed) (2006), Private ownership and private economy in the socialist-oriented market economy in

Vietnam, Chinh tri Quoc gia Publisher, Hanoi;

Chu Van Lam (ed) (2006), Collective ownership and economic cooperation in the socialist-oriented market economy in

Vietnam, Chinh tri Quoc gia Publisher, Hanoi;

Luong Minh Cu, Vu Van Thu (2011), Private ownership and private economy in Vietnam today: a number of theoretical and

practical insights, Chinh tri Quoc gia Publisher, Hanoi; 601

Nguyen Van Cuong (2013), "Commenting on ownership regulations in the draft amendment to the Constitution of 1992",

Journal of Legislative Studies, No 20 (252) / October, p 20

602 Nguyen Van Cuong (2013), "Commenting on ownership regulations in the draft amendment to the 1992 Constitution",

same for another subject that is specialized in this case as the conflict of interests between the trustee and the agent.603 One of the prerequisites for resolving conflicts of interest is to design an effective monitoring mechanism and information mechanism between the owner and the authorized person directly managing, using and exploiting properties Accordingly, it is a mechanism to handle serious and timely violations of violating subjects Therefore, the effectiveness of enforcement mechanism of the ownership by the entire people requires the construction of the following premises604:

(i) The people are acknowledged that they are the owners and initiate motivation to inspect and supervise the exploitation, management and use of properties of the ownership by the entire people It depends on the democratic foundation of the nation in which people are able to see themselves as the owners of all property of the ownership by the entire people instead of a fiction rights

(ii) It is necessary to establish a mechanism for people to inspect and supervise and have the right to information of the state (every specific state authority) so that the (ownership) authorization is not extinguished Such a mechanism is required to be legalized in relevant documents with the content directly related to the design of rules for controlling state power, the rules of the operation of the state apparatus, the accountability to the people of authorities in the state apparatus, the right to access information of people and rights related to the field of speech and journalism

(iii) The mechanism of handling violations of ownership rights by the entire people (the exploitation, management, use and disposition of assets of the ownership by the entire people which are contrary to the interests of the people) are necessarily regulated with appropriate sanctions

Regarding the requirement for the representative of the ownership by the entire people, it is necessary to consolidate in the following direction:

(i) Supplementing regulations on the responsibilities of the state in the management, use and protection of assets of the ownership by the entire people

(ii) Considering the property invested by the state in state-owned enterprises as its own property instead of stating those property as the ownership by the entire people Those enterprises, by this way, are independent in legal relations, avoiding overlapping ownership of assets It is supposed as one of the important prerequisites to build and improve the law to adjust ownership regimes

(iii) Properties of organizations and individuals recognized and protected by the state and yet nationalized

(iv) Studying and promulgating a number of laws in the following direction605: (1) Law on Information Access specifying what types of information belong to a national secret that is not public; what kind of land information is provided free of charge and provides a fee in need of searching; (2) The Law on Social Supervision aims to create a legal corridor for people to directly supervise the state management of land

Thus, it is worth finalizing that the ownership by the entire people is only clarified and effectively implemented by the completion of legal system in satisfying the rights of people to monitor the state; promoting democracy, ensuring openness and transparency in the state and state authorities to use the common resources

603

Pham Sy Thanh (2013), "Towards a real roadmap to restructure state-owned enterprises", Vietnam Economic Annual

Report 2012: Facing the challenge of economic restructuring, Nguyen Duc Thanh (ed), National University Publisher,

Hanoi, p.252-253

604

Nguyen Van Cuong (2013), "Commenting on ownership regulations in the draft amendment to the 1992 Constitution", Journal of Legislative Studies, No 20 (252) / October, p.21, 22

2.2 Recommendations on open access regimes in ownership

Different views and approaches on ownership are a typical example of the ongoing unsolved conflicts between economic, cultural and social systems in today world The recent action from the General Assembly and the UN Human Rights Commission clearly proves that The key point is the protection and promotion of the collective and community welfare values through fair distribution and use The activities of some organizations and UN agencies also follow this direction One of the goals of the UN Habitat is the use and development of land in line with the common interests of the whole society, especially to address the need for housing and land for poor The Food and Agriculture Organization (FAO) considers the relationship between land ownership and socio-economic development, as well as the role of landowners and occupiers to ensure full participation and voluntary of individuals in the country's socio-economic system has introduced policies related to land reform and rural development activities

Both ICCPR and ICESCR conventions in 1966 guarantee all rights to dispose of natural resources and prohibit acts of depriving them of their livelihoods.606 Many other statements and documents also recognize the problem, emphasizing the progress of society, the fight against exploitation and the conditions leading to the justice Article of the Declaration on Social Progress and Development calls for607: "Progress and development of

society requires the establishment of different types of land ownership and means of production, appropriate with human rights and fundamental freedoms with the principle of justice and social function of property, to eliminate exploitation and ensure fairness of property rights for all, create public conditions really equal among people" Article of this

Declaration further confirms: "The development of national wealth and income together with

the equal distribution of social resources for all members of society is an essential issue of the social progress " Some other statements have the same content as Resolution No 1083

(XVII) on permanent sovereignty over natural resources608, Charter of Economic Rights and Duties of States 609 and Return or Restitution of Cultural Property to the Country of Origin610 The general trend calling on governments to continue land reform, the return of cultural assets from museums and collectors, the nation's permanent sovereignty over natural resources, and the new economic order are the leading issues in the list of new priorities These and similar approaches close to community and collective ownership are supported by many countries in accordance with their traditions, practices and political-economic systems

In Vietnam, there is almost no research related to "open access regime", which has been causing inequality (or abuse) among subjects in society to access common resources Ownership by the entire people legally requires creating a mechanism for all citizens (co-ownership) to have the right to "determine" and "benefit" from this ownership.611 After revisions and issuance of new land laws (of 1987, 1993, 1998, 2001, 2003, 2013), it can be seen that although the state still retains rights to dispose, property rights have been decentralize to households, people and businesses From ownership by the entire people, a multi-level property rights order has appeared

606

Article 1(2)ICCPR and ICESCR

See also Article 25 CESCR and Article 47 CCPR regarding protection of the right to freedom to freely enjoy and use natural resources Article of the Bill of Rights adopted by in Algeria in July 1976 affirmed: "Everyone has the privilege of

natural resources Everyone has the right to claim reimbursement or restitution if deprived or reimbursed but not satisfactory "

607

Proclaimed by General Assembly resolution 2542 (XXIV) of 11 December 1969 Retrieved from https://www.ohchr.org/Documents/ProfessionalInterest/progress.pdf

608

Proclaimed by General Assembly resolution 1803 (XVII) of 14 December 1962

Retrieved from https://www.ohchr.org/EN/ProfessionalInterest/Pages/NaturalResources.aspx

609

Proclaimed by General Assembly resolution 3281 (XXIX) date December 12, 1974 Retrieved from http://legal.un.org/avl/ha/cerds/cerds.html

610

Proclaimed by General Assembly resolution 44/18 dated November 06, 1989 Retrieved from http://www.unesco.org/culture/laws/pdf/UNGA_resolution4418.pdf

611

An administrative decision of land allocation shall immediately formulate the exclusive property rights of an individual or business.612 Because public ownership is a tool to control the economy, Vietnam has accepted the status that each land user holds a number of rights, the state retains some rights, of which the most important is the right to recovery, transform of the use purpose and compensate land prices according to the state-determined prices for many years The common property somehow generates its own benefits; the ownership by the entire people has become a front for crony interest groups to control most of the nation's common resources including land, sea, forests, rivers, investment capital in state-owned enterprises and public projects.613

Open access, in this case, can be a possible option to solve both theoretical and practical problems related to the ownership by the entire people In the context of Vietnam, the abolition of the ownership by the entire people is impossible, however, implications downgrading the socio-economic development and causing instability in people's livelihood are supposed to be ongoing if maintain this kind of the ownership status It, again, is noted to take great effort for the realization from theory to a national policy To a certain extent, the author would like to state some initial recommendations and suggestions for further studies to improve the open access regime in a way suitable to the context of Vietnam as follows:

Absorbing the concept of "open access regime": for essential types of public property that

must be centrally managed by central or local governments (including ownership of the central government, ownership of local governments such as provinces, districts and communes and ownership of residential communities) Owners of "open access mode" are objects of immobility, unable to buy, sell, transfer and gained special protection It is possible to declare oceans, atmospheres (owned by the central government), local sources of rivers and streams (owned by local governments), forests, grazing areas, and coastal exploitation sites (owned by communities) belongs to this type of ownership

Narrowing the objects of the ownership by the entire people: Article 53, the current

Constitution lists the objects of the ownership by the entire people but lack of the classification in terms of the property of a state or a legal entity For example, "land, forests, rivers and lakes " and "state-invested and managed capital and assets " are very different in terms of characteristics and socio-economic significance It should be noted that property owned by "nation", "state" or "the entire people" not only brings resources but also a financial burden and other obligations to the people, especially as a taxpayer It is therefore not only the protection of these assets but also the control of the people with respect to its increase (e.g investment in construction or procurement of government authorities are required to be controlled within the statutory limits) The legal mechanism to identify, classify, control the increase and volatility as well as set limits on the type and scale of value for assets of a specific type of ownership are recommended to consider

Distinguishing open access regime and ownership of public rights entities:

Unlike those of the open access which is unresponsive, non-transferable, the ownership of the governmental authorities, for example the house or land lot of the central or local governments is seen as flexible to participate in civil and commercial transactions The government is able to buy, sell, convert, and transfer its owned objects on the basis of civil law The government, in essence, is a public legal entity owning property rights compared to other private entities

612

See more:Truong Thien Thu (2010), Ranjith Perera, Intermediate levels of property rights and the emerging housing market in HCM City, Vietnam, Land Use Policy (28), p 124-138

613

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